COWLES FOUNDATION FOR RESEARCH IN ECONOMICS
AT YALE UNIVERSITY

Box 208281
New Haven, CT 06520-8281

COWLES FOUNDATION DISCUSSION PAPER NO. 1578

Generalized Utilitarianism and Harsanyi’s Partial Observer Theorem

Simon Grant, Atsushi Kajii, Ben Polak and Zvi Safra

September 2006

We provide an axiomatization of generalized utilitarian social welfare functions in the context of Harsanyi's impartial observer theorem. To do this, we reformulate Harsanyi's problem such that lotteries over identity (accidents of birth) and lotteries over outcomes (life chances) are independent. We show how to accommodate (first) Diamond's critique concerning fairness and (second) Pattanaik's critique concerning differing attitudes toward risk. In each case, we show what separates them from Harsanyi by showing what extra axioms return us to Harsanyi. Thus we provide two new axiomatizations of Harsanyi's utilitarianism.

Keywords: D63, D71

JEL Classification: Generalized utilitarianism, Impartial observer, Social welfare function, Fairness, Ex ante egalitarianism